According to the Association of British Insurers, the five types of personal injury-related motor car insurance claims made most often are for brain damage, back injuries, amputations, broken bones, and whiplash injuries, with whiplash alone costing car insurance companies more than £2 billion every year.
The insurance industry body says that the high costs are one of the key reasons behind the lack of discount car insurance in the UK, as the first £90 of every motorist’s annual motor premium goes to pay these massive legal bills. The ABI’s general insurance director, Nick Starling, said that insurers face an uphill battle when it comes to fighting whiplash claims, as soft tissue injuries need a high evidential burden before they can be disproven.
Making matters worse is that fact that fraudsters have been out in force, faking accidents by making emergency stops without reason at busy slip roads or roundabouts, which forces innocent drivers to crash into the criminal’s car. These scammers then make sometimes wholly fabricated claims against the victim’s insurance firm, which usually involve grossly exaggerated injuries or claiming injuries for passengers that were not present in the car at the time.
While perpetrators of insurance fraud have traditionally skulked about in urban areas, industry experts warn that scammers are branching out into more rural areas. This could lead to not only higher fraudulent compensation payouts, but also much more serious injuries in these staged accidents, as average speeds in rural areas tend to be much higher.
Fraud adds an additional £44 a year to annual motor policies, according to estimates made by the Insurance Fraud Bureau.